The mass cancellation of coal blocks by the Supreme Court has sent banks in a jittery mode as they have extended over Rs 1 lakh crore loans to power plants that were fed by these mines.
Almost all banks including country’s largest lender State Bank of India and private sector ICICI Bank have lent to power plants that were put up based on coal from 214 coal blocks alloted since 1993.
While none of the bankers were willing to go on record on the impact of the Supreme Court ruling, sources said the lenders were assessing their exposure to the cancelled mines.
“We are glad that this is over with the SC verdict on coal blocks allocation. We now look forward for a quick plan of action for ensuring that coal supplies are not disrupted and thereafter a swift and transparent bidding process for reallocation,” SBI Chairperson Arundhati Bhattacharya said.
Earlier this month she had said: “for SBI, the exposure is only around Rs 4,000 crore, most of which are lent to power units which have fuel linkages with the affected coal blocks.” According to estimates, another public sector lender IDBI Bank has an exposure of Rs 2,000 crore.